Prepare adjusting journal entries, as needed, for the following items. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) The Supplies account shows a balance of $570, but a count of supplies reveals only $200 on hand at year-end. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $570 in Prepaid Insurance. A review of insurance policies reveals that $190 of insurance is unexpired. Employees work Monday through Friday, and salaries of $3,200 per week are paid each Friday. The company's year-end falls on Tuesday. At year-end, the company received a utility bill for December's electricity usage of $270 that will be paid in early January.

Question

Ollie

Business

25 November, 21:34

Prepare adjusting journal entries, as needed, for the following items. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) The Supplies account shows a balance of $570, but a count of supplies reveals only $200 on hand at year-end. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $570 in Prepaid Insurance. A review of insurance policies reveals that $190 of insurance is unexpired. Employees work Monday through Friday, and salaries of $3,200 per week are paid each Friday. The company's year-end falls on Tuesday. At year-end, the company received a utility bill for December's electricity usage of $270 that will be paid in early January.

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Keely Lane · Answer 1

The adjusting entries are shown below:

1. Supplies expense A/c Dr $370

To supplies A/c $370

(Being supplies account is adjusted)

The supplies expense is computed by

= Supplies balance - supplies on hand

= $570 - $200

= $370

2. Insurance expense A/c Dr $190

To Prepaid Insurance $190

(Being prepaid insurance is adjusted)

3. Salaries expense A/c $1,280

To Salaries payable A/c $1,280

(Being salary is adjusted)

The salaries expense is computed by

= Total five days * number of days : total number of days

= $3,200 * (2 : 5)

= $1,280

4. Electricity expense A/c Dr $270

To electricity payable A/c $270

(Being electricity usage is adjusted)